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Oil rises on promise from Saudis to limit exports next month

25 July 2017

The likes of Russia, Kazakhstan, Azerbaijan, and other non-OPEC countries joined leading countries such as Saudi Arabia, Iran, Iraq, and other members to cut global production in a joint effort to help the oil prices ease from the turmoil it is in.

US crude futures rose 65 cents, or 1.42%, to $46.42 a barrel on the New York Mercantile Exchange.

The statements by the oil producers pushed up oil prices, with the price climbing around 1 percent in London to more than $48.50 in the afternoon.

The minister pointed out that if it came to monitoring oil export, it would be necessary to monitor the export of oil products as well.

OPEC's production has crept up since January when the group of major oil producing nations teamed with Russian Federation to reduce output by 1.8 million barrels per day.

Ironically, or perhaps fulfilling earlier suggestions along these lines, OPEC's noncompliance may yet prove to be the best antidote-albeit a temporary one-to USA shale's aggressive growth, which has seen a near 50-percent increase to the number of active oil and gas rigs in 2017 alone.

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Nigeria was ready to cap or even reduce supply if it can maintain output of 1.8-million barrels a day, said the two people, asking not to be identified because the information is confidential. The North American benchmark WTI is now trading at $45.8 per barrel and Brent at $2.3 per barrel premium to WTI.

Oil ministers overseeing the effectiveness of a multi-country deal to curb output and lift world oil prices yesterday urged further moves by the group to strengthen that deal and extend it beyond it beyond the first quarter of 2018.

In January, an OPEC source told Reuters that based on previous compliance agreements, 50 percent to 80 percent compliance would be good.

Nigeria's foreign reserves has increased to $30.5 billion due to rise in global oil prices. Nigeria's oil minister said earlier this year Abuja is targeting 1.8 million bpd before it considers joining the cut.

The committee did not back capping Libyan output as it said its production was unlikely to exceed 1 million bpd in the near.

OPEC secretary, General Mohammad Barkindo said on Sunday that supply and demand in the oil market was moving in suppliers' favor, but that the rebalancing had been slower than expected.

Oil rises on promise from Saudis to limit exports next month